A 400D rebel is the camera too old?

someone wants to sell a Rebel for 500 bucks including a couple of kit lenses
a 50mm and a 18-55 IS just your basic cheap kit lenses.

I am just wondering if this camera is out dated? I mean in terms of technology isn't it a dinosaur? would it be better to just spend another 500 bucks and get a new line camera , say something like the 550d? and then I could add lenses to that and have something which I could use for a couple years and then sell off, instead of having a camera which is already 4 years old?
the 400d's are 4 years old right?